– The project will support companies in Brazil, Chile, Colombia, Mexico and Peru
WASHINGTON, USA – IDB Invest announced a $15 million investment in the Blue like an Orange Sustainable Capital Latin America Fund II (Sub-Fund II), part of the Blue like an Orange Sustainable Capital Fund SICAV-SIF SCS. This impact investment private structured credit fund aims to foster inclusive and sustainable development by delivering strong social impact and market-based risk-adjusted returns in emerging markets.
The project seeks to increase the availability of long-term financing for companies in Latin America and the Caribbean with proven business models that have a measurable positive impact. By providing tailored financing and a sustainability-driven approach to its investments, Blue like an Orange will support companies in achieving their growth objectives while promoting sustainability, innovation and gender equality.
The Sub-Fund II seeks to invest in companies that deliver social impact in direct support of the UN Sustainable Development Goals (SDGs), to foster inclusive and sustainable growth in healthcare, education, financial services, agriculture, housing, and technology. The investment focus will be on companies based or active in Latin America and the Caribbean, with a special focus on Brazil, Chile, Colombia, Mexico and Peru.
Private sector investment and innovation are crucial to achieving the SDGs. Despite progress, business engagement remains limited, with only 6 percent of companies reporting both positive and negative impacts on the SDGs. In Latin America and the Caribbean, challenges such as informal labor markets, gender inequality, and limited adoption of sustainable practices hinder progress. Addressing these gaps requires innovative financing solutions.
Structured credit products have emerged as critical tools, offering growth capital for mid-sized companies unable to access traditional funding. Blue like an Orange provides structured credit solutions, mobilizing new investors, and fostering sustainable development across the region.
IDB Invest will also provide advisory services to strengthen Blue like an Orange’s climate change and gender, diversity, and inclusion (GDI) strategies. The climate focus includes enhancing finance solutions and nature-based policies, while the GDI component will help improve diversity practices using IDB Invest’s Diversity Tool, focusing on indigenous peoples, people with disabilities, afro-descendants, and LGBTQ+ individuals. IDB Invest will also require Blue like an Orange to implement an Environmental and Social Action Plan to improve climate risk management and grievance mechanisms.
This deal is expected to contribute to the following SDGs: Gender Equality (SDG 5), Decent Work and Economic Growth (SDG 8), Industry, and Innovation & Infrastructure (SDG 9), Reduce Inequalities (SDG 10), Responsible Consumption and Production (SDG 12), and Climate Action (SDG 13).
